MGMT 100 Exam 3 (Ch. 12) Questions
With New Update Solutions
/. A contract that is oral when it is required to be evidenced by a writing or an electronic
record is voidable by:
A. agreement of both parties to the contract.
B. the party who wrote the contract.
C. the party who does not wish to follow through with the agreement.
D. the party who wishes to follow through with the agreement. - Answer-✅C. the party
who does not wish to follow through with the agreement.
/.Sally agrees to tutor Fred's children. If Fred assigns his right to Sally's services to Don,
this assignment:
A. will be allowed only if Don agrees.
B. generally will not be allowed because it involves personal services.
C. generally will be allowed because it involves personal services.
D. generally will be allowed because it is an assignment rather than a delegation. -
Answer-✅B. generally will not be allowed because it involves personal services.
/.Edgar is fifteen. In most states, for contractual purposes, Edgar would be considered a
minor until he is:
A. twenty-one.
B. sixteen.
C. seventeen.
D. eighteen. - Answer-✅D. eighteen
/.Smith Contractors & Builders, Inc. is hired to build a new store for Books on the
Border, Inc. The contract sets the amount for the construction at $250,000. After the
company begins construction, the builders discover that the building site has many
previously undetected problems that will make construction of the building much more
expensive than previously anticipated. Smith Contractors & Builders:
A. can make a case to charge more than the original contract based on lack of legally
sufficient value.
B. can make a case to charge more than the original contract based on unforeseen
difficulties.
C. can make a case to charge more than the original contract based on preexisting
duty.
D. has no basis to make a case to charge more than the original contract. - Answer-✅B.
can make a case to charge more than the original contract based on unforeseen
difficulties.
,/.Grant offers to sell his Honda Civic for $10,000 to Ivy. Referring to the prices for similar
Hondas, Ivy says, "I'll pay no more than $5,000." Grant says, "Forget it." Grant's offer
was terminated by:
A. no one—Grant's offer is still open.
B. Grant.
C. Ivy.
D. Honda. - Answer-✅C. Ivy.
/.John enters into a contract with Katie to paint Katie's house for $10,000. Halfway
through the job, John says that he will not complete the job unless Katie gives him an
extra $5,000. Katie agrees. Which of the following is correct?
A. Katie will not have to pay the extra $5,000 since the promise was in the past.
B. Katie will have to pay the extra $5,000 because she agreed.
C. Katie will not have to pay the extra $5,000 since John had a preexisting legal duty to
finish painting the house.
D. Katie will have to pay the extra $5,000 only if John finishes painting the house. -
Answer-✅C. Katie will not have to pay the extra $5,000 since John had a preexisting
legal duty to finish painting the house.
/.Ophelia has been seriously ill for some time, and wants to plan so that her family will
have as little stress as possible at her passing. She calls Homer, who two years ago
purchased 4 cemetery plots, and asks him to sell her one. During that telephone call,
Homer agrees, and they decide on the price of $1200. Ophelia mails her check for that
amount to Homer, and checks one more thing off her list. When Ophelia dies, what will
happen if Homer refuses to honor the agreement?
A. Ophelia will be buried in the cemetery plot.
B. Ophelia will not be buried in the cemetery plot, since the contract was not in writing.
C. Homer will be buried in the cemetery plot.
D. None of these options. - Answer-✅B. Ophelia will not be buried in the cemetery plot,
since the contract was not in writing.
/.The Uniform Commercial Code requires a writing or memorandum for the sale of
goods priced at:
A. $1000 or more.
B. $250 or more.
C. $750 or more.
D. $500 or more. - Answer-✅D. $500 or more.
/.Lightspeed Corporation makes computers, each of which is packaged with a shrink-
wrap agreement. Milo buys a Lightspeed desktop. The shrink-wrap agreement is most
likely enforceable if:
A. the terms in the shrink-wrap agreement concern warranties.
B. Milo buys the computer directly from Lightspeed.
C. Milo reads the shrink-wrap agreement.
D. Milo expressly agrees to the terms in the shrink-wrap agreement. - Answer-✅D. Milo
expressly agrees to the terms in the shrink-wrap agreement.
, /.Bret enters into a contract with Collegiate University over the Internet to take an online
course titled "Internet Law." This is an e-contract because:
A. the subject matter of the contract is "Internet Law."
B. the contract was entered into over the Internet.
C. the contract will be performed online.
D. the contract was formed between a student and a university. - Answer-✅B. the
contract was entered into over the Internet.
/.George and Halle disagree as to the exact amount one owes the other. They form a
new agreement that, on fulfillment, will discharge the prior obligation. This is:
A. promissory estoppel.
B. a covenant not to sue.
C. a release.
D. an accord and satisfaction. - Answer-✅D. an accord and satisfaction.
/.Jill and Kurt enter into a contract under which Jill agrees to pay Kurt $125 for a new
briefcase. Kurt's transfer of his right to receive this payment is:
A. not a delegation, an assignment, or a third party beneficiary contract.
B. a delegation.
C. a third party beneficiary contract.
D. an assignment. - Answer-✅D. an assignment.
/.If a covenant not to compete is found to be unreasonable in time or geographic area,
the court may convert the terms into reasonable ones through a process called:
A. promissory estoppel.
B. reformation.
C. accord and satisfaction.
D. adhesion. - Answer-✅B. reformation.
/.The objective theory of contracts:
A. means that a party's intention to enter into a legally binding agreement is judged by
outward, objective facts as interpreted by a reasonable person.
B. maintains the importance of the subjective intentions of the parties involved.
C. maintains the importance of going beyond what was openly said or manifested by
conduct to determine whether a contract has been formed.
D. is a theory concerning the objectionable aspects of contract disputes. - Answer-✅A.
means that a party's intention to enter into a legally binding agreement is judged by
outward, objective facts as interpreted by a reasonable person.
/.The highest legal interest rate in the state where a finance company resides is 18%.
Nevertheless, the finance company charges 22-25% interest on the loans it makes. The
finance company has committed:
A. restraint of trade.
B. usury.
C. procedural unconscionability.
With New Update Solutions
/. A contract that is oral when it is required to be evidenced by a writing or an electronic
record is voidable by:
A. agreement of both parties to the contract.
B. the party who wrote the contract.
C. the party who does not wish to follow through with the agreement.
D. the party who wishes to follow through with the agreement. - Answer-✅C. the party
who does not wish to follow through with the agreement.
/.Sally agrees to tutor Fred's children. If Fred assigns his right to Sally's services to Don,
this assignment:
A. will be allowed only if Don agrees.
B. generally will not be allowed because it involves personal services.
C. generally will be allowed because it involves personal services.
D. generally will be allowed because it is an assignment rather than a delegation. -
Answer-✅B. generally will not be allowed because it involves personal services.
/.Edgar is fifteen. In most states, for contractual purposes, Edgar would be considered a
minor until he is:
A. twenty-one.
B. sixteen.
C. seventeen.
D. eighteen. - Answer-✅D. eighteen
/.Smith Contractors & Builders, Inc. is hired to build a new store for Books on the
Border, Inc. The contract sets the amount for the construction at $250,000. After the
company begins construction, the builders discover that the building site has many
previously undetected problems that will make construction of the building much more
expensive than previously anticipated. Smith Contractors & Builders:
A. can make a case to charge more than the original contract based on lack of legally
sufficient value.
B. can make a case to charge more than the original contract based on unforeseen
difficulties.
C. can make a case to charge more than the original contract based on preexisting
duty.
D. has no basis to make a case to charge more than the original contract. - Answer-✅B.
can make a case to charge more than the original contract based on unforeseen
difficulties.
,/.Grant offers to sell his Honda Civic for $10,000 to Ivy. Referring to the prices for similar
Hondas, Ivy says, "I'll pay no more than $5,000." Grant says, "Forget it." Grant's offer
was terminated by:
A. no one—Grant's offer is still open.
B. Grant.
C. Ivy.
D. Honda. - Answer-✅C. Ivy.
/.John enters into a contract with Katie to paint Katie's house for $10,000. Halfway
through the job, John says that he will not complete the job unless Katie gives him an
extra $5,000. Katie agrees. Which of the following is correct?
A. Katie will not have to pay the extra $5,000 since the promise was in the past.
B. Katie will have to pay the extra $5,000 because she agreed.
C. Katie will not have to pay the extra $5,000 since John had a preexisting legal duty to
finish painting the house.
D. Katie will have to pay the extra $5,000 only if John finishes painting the house. -
Answer-✅C. Katie will not have to pay the extra $5,000 since John had a preexisting
legal duty to finish painting the house.
/.Ophelia has been seriously ill for some time, and wants to plan so that her family will
have as little stress as possible at her passing. She calls Homer, who two years ago
purchased 4 cemetery plots, and asks him to sell her one. During that telephone call,
Homer agrees, and they decide on the price of $1200. Ophelia mails her check for that
amount to Homer, and checks one more thing off her list. When Ophelia dies, what will
happen if Homer refuses to honor the agreement?
A. Ophelia will be buried in the cemetery plot.
B. Ophelia will not be buried in the cemetery plot, since the contract was not in writing.
C. Homer will be buried in the cemetery plot.
D. None of these options. - Answer-✅B. Ophelia will not be buried in the cemetery plot,
since the contract was not in writing.
/.The Uniform Commercial Code requires a writing or memorandum for the sale of
goods priced at:
A. $1000 or more.
B. $250 or more.
C. $750 or more.
D. $500 or more. - Answer-✅D. $500 or more.
/.Lightspeed Corporation makes computers, each of which is packaged with a shrink-
wrap agreement. Milo buys a Lightspeed desktop. The shrink-wrap agreement is most
likely enforceable if:
A. the terms in the shrink-wrap agreement concern warranties.
B. Milo buys the computer directly from Lightspeed.
C. Milo reads the shrink-wrap agreement.
D. Milo expressly agrees to the terms in the shrink-wrap agreement. - Answer-✅D. Milo
expressly agrees to the terms in the shrink-wrap agreement.
, /.Bret enters into a contract with Collegiate University over the Internet to take an online
course titled "Internet Law." This is an e-contract because:
A. the subject matter of the contract is "Internet Law."
B. the contract was entered into over the Internet.
C. the contract will be performed online.
D. the contract was formed between a student and a university. - Answer-✅B. the
contract was entered into over the Internet.
/.George and Halle disagree as to the exact amount one owes the other. They form a
new agreement that, on fulfillment, will discharge the prior obligation. This is:
A. promissory estoppel.
B. a covenant not to sue.
C. a release.
D. an accord and satisfaction. - Answer-✅D. an accord and satisfaction.
/.Jill and Kurt enter into a contract under which Jill agrees to pay Kurt $125 for a new
briefcase. Kurt's transfer of his right to receive this payment is:
A. not a delegation, an assignment, or a third party beneficiary contract.
B. a delegation.
C. a third party beneficiary contract.
D. an assignment. - Answer-✅D. an assignment.
/.If a covenant not to compete is found to be unreasonable in time or geographic area,
the court may convert the terms into reasonable ones through a process called:
A. promissory estoppel.
B. reformation.
C. accord and satisfaction.
D. adhesion. - Answer-✅B. reformation.
/.The objective theory of contracts:
A. means that a party's intention to enter into a legally binding agreement is judged by
outward, objective facts as interpreted by a reasonable person.
B. maintains the importance of the subjective intentions of the parties involved.
C. maintains the importance of going beyond what was openly said or manifested by
conduct to determine whether a contract has been formed.
D. is a theory concerning the objectionable aspects of contract disputes. - Answer-✅A.
means that a party's intention to enter into a legally binding agreement is judged by
outward, objective facts as interpreted by a reasonable person.
/.The highest legal interest rate in the state where a finance company resides is 18%.
Nevertheless, the finance company charges 22-25% interest on the loans it makes. The
finance company has committed:
A. restraint of trade.
B. usury.
C. procedural unconscionability.
